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Aquino v. United Property & Casualty Insurance Co.

Superior Court of Massachusetts, Suffolk

September 25, 2018

Wenda AQUINO
v.
UNITED PROPERTY & CASUALTY INSURANCE COMPANY

          MEMORANDUM OF DECISION AND ORDER ON PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND DEFENDANT’S CROSS-MOTION FOR SUMMARY JUDGMENT

          Paul D. Wilson, Justice of the Superior Court

          This suit arises out of a 2017 fire at the home of Plaintiff Wenda Aquino, for which Aquino sought payments under her homeowner’s insurance policy. That policy was issued to her by Defendant United Property & Casualty Insurance Company ("UPC"). UPC denied payment to Aquino on the ground that the damage was intentionally caused by Aquino’s fiancé, who was a named co-insured on the policy, and that the homeowner’s policy excludes recovery by any insured in such a circumstance.

         Aquino filed this suit seeking declaratory and other relief to reform the homeowner’s policy to provide for coverage of her claimed damages, and she seeks damages for unfair and deceptive trade acts and practices by UPC under G. L. c. 93A and G. L. c. 176D. In the present motion, Aquino seeks summary judgment on Count I (declaratory judgment), Count II (breach of contract), and Count VII (reformation of the policy). UPC has cross-moved for summary judgment on all counts in the Plaintiff’s complaint. For the reasons stated below, the Plaintiff’s motion is ALLOWED IN PART and DENIED IN PART, and the Defendant’s motion is ALLOWED IN PART and DENIED IN PART.

         BACKGROUND

         The following facts, drawn from the summary judgment record, are uncontested. Some facts are reserved for discussion below.

         In 2014, Aquino and her fiancé, Kelly Pastrana, purchased a two-family residential dwelling located at 80 Warren Avenue in Chelsea, Massachusetts (the "Property"). Both Aquino and Pastrana are listed on the deed and mortgage for the Property. UPC issued a homeowner’s insurance policy to Aquino and Pastrana covering the Property ("the Policy") that was effective at the time of the events at issue in this case.

         On May 22, 2017, a fire caused extensive damage to the Property. For purposes of the present motions, the parties do not contest that the fire was caused by an intentional act of Pastrana, and that Aquino was innocent of any involvement. Pastrana died in the fire.

         After the fire, Aquino asserted several claims under the Policy for the damages she sustained, including claims for (a) destruction of the building situated on the Property, (b) destruction of the driveway, walkway, patio, retaining wall and stairs/railings on the Property, (c) loss of personal property contained in the building situated on the Property, (d) loss of rental income and additional living expenses, (e) costs associated with enforcement of "ordinance or law" against Aquino as owner of a Property containing a fire-damaged and unsafe structure, (f) destruction to landscaping, trees and shrubs, and (g) debris removal.[1]

         On August 18, 2017, UPC denied its liability for Aquino’s claims, citing the Intentional Loss Exclusion provision in the Policy.[2] That provision states, in relevant part:

SECTION I - EXCLUSIONS
A. We do not insure for loss caused directly or indirectly by any of the following....
8. Intentional Loss
Intentional Loss means any loss arising out of any act an ‘insured’ commits or conspires to commit with the intent to cause a loss.
In the event of such loss, no ‘insured’ is entitled to coverage, even "insureds" who did not commit or conspire to commit the act causing the loss.

         Aquino and Pastrana are both named insureds on the Policy.

         Aquino brought the present suit against UPC to recover the damages she sustained in the fire. There are eight counts in the complaint: Count I is for declaratory judgment; Count II is for breach of contract; Count III is for breach of the implied covenant of good faith and fair dealing; Count IV is for promissory estoppel; Count V is for equitable estoppel; Count VI is for waiver; Count VII is for reformation of the policy; and Count VIII is for unfair and deceptive trade acts and practices. In the first seven counts, Aquino seeks payment of all of her claimed damages under the Policy, as well as attorney’s fees, costs, and interest. In Count VIII, Aquino seeks relief under G. L. c. 93A and G. L. c. 176D for alleged unfair and deceptive trade acts and practices by UPC, for which she seeks double or treble the amount of her actual damages, as well as attorneys’ fees, costs, and interest.

         DISCUSSION

         I. Legal Standard

         Summary judgment is properly entered "if the pleadings, depositions, answers to interrogatories, and responses to requests for admission under Rule 36, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Mass. R. Civ. P. 56(c); see Miramar Park Ass’n, Inc. v. Dennis, 480 Mass. 366, 376 (2018). "The moving party bears the burden of affirmatively demonstrating that there is no triable issue of fact." Ng Bros. Constr. v. Cranney, 436 Mass. 638, 644 (2002). The interpretation of an insurance policy raises a question of law that is appropriately resolved on summary judgment. See Massachusetts Bay Transp. Auth. v. Allianz Ins. Co., 413 Mass. 473, 476 (1992).

         II. Analysis

         A. Whether Aquino can recover under the policy

         Aquino moves for summary judgment on Count I (declaratory judgment), Count II (breach of contract), and Count VII (reformation), arguing that the Policy must be reformed to comport with certain statutory requirements, and that UPC is in breach of the Policy as reformed. UPC cross-moves for summary judgment on the same Counts.

         The parties do not dispute that the provision of the Policy governing intentional loss is unambiguous. That provision, if enforced as written, would impose a joint obligation on insureds not to cause intentional loss, and would thus preclude any recovery by Aquino as a consequence of the intentional act of Pastrana.

         Aquino’s argument is rather that the Policy is not enforceable as written and must be reformed pursuant to G. L. c. 175, § 99 to allow for payments to her as an innocent co-insured party. That statute, entitled "Standard Form of Fire Policy," mandates the form of fire insurance policies in Massachusetts. Ideal Fin. Servs., Inc. v. Zichelle,52 Mass.App.Ct. 50, 66 (2001). The statute provides that "[n]o company shall issue policies or contracts which ... insure against loss or damage by fire ... to property or interests in the commonwealth, other than those of the standard forms herein set forth," subject to certain exceptions not raised here. G. L. c. 175, § 99. Aquino argues that the Intentional Loss provision provides for a ...


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